Short answer
Yes. FHA's HECM for Purchase lets a buyer 62 or older buy a new principal residence and take out a reverse mortgage on it in one closing. You put in a cash investment to cover the difference between the price and what the reverse mortgage provides, often from selling your current home, and then you have no required monthly mortgage payment, though you still pay taxes, insurance and upkeep.
How does it work?
HUD's Handbook 4000.1 describes HECM for Purchase as a way to finance a new principal residence and get a HECM in a single transaction. The reverse mortgage covers part of the price, based on your age, the home's value and interest rates. You provide the rest, called the monetary investment: the gap between the HECM's available funds and the price, plus any fees not financed, minus your earnest money. You can put in more to leave some HECM funds available for later.
What are the main rules?
- The youngest borrower must be at least 62, and you must complete HECM counseling.
- You must move in within 60 days of closing, and you can have only one principal residence. If you have a HECM on your current home, it must be paid off first.
- The home can be a 1-4 unit home (living in one unit), a one-unit home with an ADU, a condo in an FHA-approved project, or a manufactured home that meets FHA's standards. New construction is allowed with required inspections.
- Everyone on the purchase contract must be a borrower; a non-borrowing spouse may be listed.
Where can the cash investment come from?
HUD allows cash on hand, money from selling or cashing out your assets (such as your current home), seller or other interested party contributions within FHA rules, and other acceptable sources. A borrower who is the licensed real estate agent on the purchase can use their commission. Sweat equity, trade equity, rent credits and lender premium pricing can't be used for it.
Is it right for me?
It can suit someone downsizing or moving closer to relatives who wants to avoid a monthly mortgage payment. It reduces the equity left later, the loan grows over time, and missing tax, insurance or upkeep obligations can trigger default. Read how reverse mortgages work in NH and mortgages in retirement, and compare with a regular loan or buying with cash. See also buying before you sell.
Sources
Checked November 2, 2026. Rules and dates change, so confirm current details before you rely on them.
General information only, not tax or legal advice. Program availability, eligibility and terms vary by lender and are subject to change and to underwriting approval. Not a commitment to lend.